The statements in this section merely provide background information related to the present disclosure and may not constitute prior art.
The U.S. is currently flaring so much stranded natural gas that the gas flares are visible from outer space. The world annually flares about 5,000 billion cubic feet (BCF) of stranded gas. This is equivalent to the annual gas usage of France and Italy combined, and represents about 5% of the world's gas production. It is estimated that in North Dakota alone, where oil production from fracking had reached 1 million barrels per day in 2014, around 36% of North Dakota's associated gas was flared—about 120 BCF/yr. All this flare gas produces significant quantities of CO2 emissions, estimated to be about 7 million tons of CO2-equivalents into the atmosphere from North Dakota's flaring, or the emissions from about 1.3 million cars, while producing no useful product. Furthermore, North America is facing a vast abundance of natural gas generally, driving natural gas prices to historical lows, making it an ideal feedstock for liquid fuel production.
Flaring of natural gas entails significant loss of income for oil and gas producers that could be earned by selling the natural gas product. Still more financial losses are entailed by failing to make use of the energy content of the flared gas to generate power. As a result, such producers must buy their electric power from the grid, or even worse, generate it themselves at significant cost (typically USD$0.40/kWh) using on-site diesel generators consuming expensive diesel fuel. Furthermore, the large-scale flaring of natural gas has raised environmental issues that could cause state and/or federal regulators to act to fine, shutdown, or highly regulate their operations.
The United States oil and gas industry annually flared approximately 7.1 billion cubic meters (bcm), or 250 billion cubic feet (bcf) in 2011 (Source: Global Gas Flaring Reduction Partnership, Estimated Flared Volumes from Satellite Data, 2007-2011, 2013), and the situation has only gotten worse. “Flaring will escalate as oil producers approach the milestone of 1 million barrels a day from the Bakken formation, a 360-million-year-old shale bed two miles underground. About 10,100 wells produced 29 million barrels of oil in January 2014, according to the North Dakota Industrial Commission. Drillers flared 340 million cubic feet (mmcf), or 34 percent, of the 1 billion cubic feet of natural gas produced per day in January 2014, about twice as much as the 184 million cubic feet burned per day in 2011, said Marcus Stewart, an analyst at Denver-based Bentek Energy. ‘The lost revenue adds up to $1.4 million each day,’ said Stewart. Energy executives say economic realities force them to start producing oil from wells before infrastructure is in place to haul away less-valuable natural gas.” (Source: Jennifer Oldham, A Landscape of Fire Rises Over North Dakota's Gas Fields, Bloomberg News, Apr. 7, 2014)
Canada also has a significant flaring problem. It is estimated that Canada flared 2.4 billion m3 per year in 2011 (Source: Global Gas Flaring Reduction Partnership, Estimated Flared Volumes from Satellite Data, 2007-2011, 2013.) It is estimated that the Canadian province of Alberta alone flared 868 million m3 and vented another 333 million m3 in 2007. (Source: Bott, R. D., Flaring Questions and Answers, 2nd ed., Canadian Centre for Energy Information, 2007.) A similar situation holds around the world, with significant quantities of gas being flared in Russia, Nigeria, and other parts of the world.
Flaring produces significant quantities of CO2 emissions while producing no useful product. If this wasted flare gas could be utilized for powering drilling rigs and other oil field equipment, used to produce liquid fuel, and/or transported for sale to market, significant environmental and economic benefits would accrue.
Furthermore, gas produced as a by-product of fracking shale for oil is often rich in natural gas liquids (NGLs), including, but not limited to, in the Bakken formation of North Dakota, United States. Although natural gas prices are at a historic low in the United States, the high concentration of NGLs justifies gathering and processing the gas. However, as gas gathering infrastructure is put into place, and statutory restrictions kick in after 12 months after initial drilling, flaring on old wells may be reduced. Unfortunately, newly drilled wells as well as wells far from pipeline infrastructure will continue to be flared. This high variability and uncertainty in flaring quantities make it extremely difficult to plan and effectively size traditional gas gathering and pipeline infrastructure to minimize flaring.
It is highly financially and environmentally disadvantageous to flare valuable natural gas that could be sold for profit. It is even more financially and environmentally disadvantageous to utilize large quantities of diesel for power generation while at the same time flaring a feedstock that could be doing the same job. The problem is that liquids-rich raw natural gas cannot be used in generators and cannot be transported by truck.
Whereas the problem of flare gas was previously recognized, two known solutions included (1) pipelines to transport the raw natural gas to natural gas plants/refineries, and (2) mobile systems to process the flare gas on-site. These will be briefly discussed in turn. First, pipelines can be built to transport the raw natural gas from oil fields currently flaring to natural gas plants/refineries. This has several drawbacks, including complexity, cost, long-lead time, and permitting issues associated with building pipelines. An additional problem with pipelines is the flare volumes are highly uncertain and variable, making it difficult to plan pipeline construction. Additionally, pipelines cannot be deployed quickly to address the existing problem in real-time, nor can they be moved when flare volumes decrease. Finally, even if pipelines could be built, natural gas plants are highly expensive and large, capital-intensive infrastructure projects that would take time and large capital to finance and build.
Secondly, existing mobile systems have many shortcomings; all existing mobile systems are designed to either capture NGLs or produce dry generator gas. Some existing mobile systems are designed for extracting NGLs from the raw natural gas, and then flare the remaining methane and ethane because it is unusable in existing gensets. Other existing mobile systems generate high-quality (lean) methane for CNG production or pipelines, and flare the remaining NGLs because it has high ethane content (and hence a high vapor pressure), and cannot be transported in existing tanks. Many mobile systems utilize the Joule-Thompson (J-T) effect, and cannot remove a substantial portion of the ethane content in the flare gas, resulting in a gas mixture that is unpractical to use in existing, unmodified gensets. The system design presented in the present application solves the problems with both existing pipeline-based solutions as well as existing mobile systems by producing a transportable fuel from the raw natural gas feedstock.
Therefore, there exists an important need for a solution to address the problem of utilizing raw natural gas (wet or dry), which may have significant quantities of NGLs, to the maximum extent and to minimize or eliminate flaring, while still meeting the operators' requirements of a highly variable and uncertain flow rate in the raw natural gas stream.
Accordingly, as recognized by the present inventors, what are needed are a novel method, apparatus, and system for converting raw natural gas into a liquid stream that can be easily transported by truck, and that can be utilized for transportation and/or power generation, or for other purposes in existing equipment. As recognized by the present inventors, what is also needed is a liquid fuel synthesis system that is compact, portable, and modular, and which can be easily and quickly delivered to, as well as removed from, flare gas sites as flaring volumes change and as natural gas infrastructure matures.
Therefore, it would be an advancement in the state of the art to provide an apparatus, system, and method for producing a liquid fuel from a raw natural gas source at or near an oil or gas site that flares its associated gas. It would also be an advancement in the state of the art to provide a compact, portable, and modular liquid fuel production apparatus that can be used anywhere there is stranded, flared, or low-value natural gas.
It is against this background that various embodiments of the present invention were developed.